Main
Functions

Monetary
Authority:

Formulates,
implements and monitors the monetary policy.

Objective:
maintaining price stability and ensuring adequate flow of
credit to productive sectors.Regulator and supervisor of the
financial system:

Prescribes
broad parameters of banking operations within which the
country's banking and financial system functions.

Objective:
maintain public confidence in the system, protect
depositors' interest and provide cost-effective banking
services to the public.

Manager
of Foreign Exchange

Manages
the Foreign Exchange Management Act, 1999.

Objective:
to facilitate external trade and payment and promote orderly
development and maintenance of foreign exchange market in
India
.

Issuer
of currency:

Issues
and exchanges or destroys currency and coins not fit for
circulation.

Objective:
to give the public adequate quantity of supplies of currency
notes and coins and in good quality.

Developmental
role

Performs
a wide range of promotional functions to support national
objectives.

Related
Functions

Banker
to the Government: performs merchant banking function for
the central and the state governments; also acts as their
banker.

Banker
to banks: maintains banking accounts of all scheduled banks.

All
urban co-operative banks are being looked after by its
department ‘Urban Banks Department’.As such ,The Kangra
Co-operative Bank Limitedalso comes under this department’s jurisdiction. A
brief note on Urban Banks department is appended herebelow
for the information of all users of this web site.

Urban
Banks Department

The
Urban Banks Department looks after the regulation and
supervision of primary co-operative banks. The banks are
outside the federal rural credit structure supervised by
NABARD and function primarily in the urban areas.

The
activities of the Department can be broadly divided into
four areas, viz.,
regulatory, supervisory, operational and developmental.

The
regulation and supervision of primary co-operative banks,
popularly known as "urban co-operative banks", is
performed by the Urban Banks Department in co-ordination
with the Registrars of Co-operative Societies of the State
Governments.

The
Reserve Bank of
India
regulates the interest rates on deposits and advances only
to the extent of prescribing interest rate on saving
accounts and a minimum lending rate on advances. It
prescribes minimum cash reserve and liquid assets to be
maintained as a ratio of net demand and time liabilities,
and also lays down norms for investments in other assets by
primary co-operative banks.

The
Department coordinates the refinance facilities granted by
the Reserve Bank of
India
to State Co-operative Banks on behalf of urban co-operative
banks for financing 22 broad groups of approved cottage and
tiny industries as an incentive for financing industrial
activities.

As
a part of developmental activity, the Reserve Bank of
India
conducts special courses for senior personnel of urban
co-operative banks at its
College
of
Agricultural Banking
, Pune.

The
Reserve Bank has recently reviewed the new bank licensing
policy for cooperative banks and the branch licensing policy
for them in pursuance of the recommendations of a High Power
Committee under the Chairmanship of Shri K. Madhava Rao,
Member, Central Board, Reserve Bank of
India
.

In
coordination with state co-operative departments and the
apex co-operative banks, the Reserve Bank closely monitors
the performance of a co-operative banks identified as `weak'
in different states.